US sells USD 69bln 2-year notes: Stop-through 0.5bps

• High Yield: 4.315% (prev. 4.189%, six-auction avg. 3.841%); WI: 4.320%


• Tail: -0.5bps (prev. -0.3bps, six-auction avg. 0.1bps)


• Bid-to-Cover: 2.66x (prev. 2.64x, six-auction avg. 2.63x)


• Dealers: 9.36% (prev. 10.2%, six-auction avg. 12.6%)


• Directs: 34.05% (prev. 34.3%, six-auction avg. 29.2%)


• Indirects: 56.59% (prev. 55.5%, six-auction avg. 58.2%)

Analysis details (18:15)

Overall, a strong 2-year note auction. The US Treasury sold USD 69bln of 2-year notes at a high yield of 4.315%, above the prior auction's 4.189% and the six-auction average of 3.841%. The auction stopped through the when-issued yield of 4.320% by 0.5bps, improving from the prior 0.3bp stop-through and comfortably stronger than the six-auction average 0.1bp tail.

Demand metrics were firm. The bid-to-cover ratio rose to 2.66x from 2.64x, above the six-auction average of 2.63x. Dealers were left with just 9.36% of the issue, down from 10.2% previously and well below the 12.6% average.

The bidder breakdown was also encouraging. Direct bidders took 34.05% of the auction, broadly unchanged from the prior 34.3% but comfortably above the 29.2% six-auction average. Indirect participation improved to 56.59% from 55.5%, although it remained slightly below the 58.2% average.

Overall, the auction points to healthy demand for front-end Treasuries at current yield levels, with the 0.5bp stop-through, above-average bid-to-cover and low dealer allocation all supportive. Direct demand remained particularly strong, while the improvement in indirect participation from the prior auction added to the constructive result ahead of Wednesday's FOMC decision.

27 Jul 2026 - 16:32- ForexImportant- Source: Market Source